By Emeka Anaeto, Economy Editor
LAGOS—Interbank interest rate went down further yesterday to this year’s low of 2.3 percent as the Central Bank of Nigeria, CBN, withholds fresh issue of treasury bills.
The rate had hit three-month low of 3.5 percent last week from over 50 percent recorded three weeks ago in the wake of Treasury Single Account policy which pulled over N1.2 trillion deposits from banks.
The apex bank also credited the banks with excess cash reserve provisions yesterday evening in line with the new cash reserve requirement, CRR, reduction to 25 percent from 31 percent.
Bank treasurers told Vanguard that there was high liquidity in the banking system, forcing the rates down in interbank market, but not yet sustainable enough to impact lending rates.
Prime lending rates are still over 18 percent in some banks. Yesterday’s cash inflows to the banks surged banking system credit with CBN to N1.1 trillion after it had opened at N355 billion, indicating that the CRR inflow was less than N700 billion.
Last week the bankers’ committee meeting briefing by the Managing Director of Fidelity Bank Plc, Mr. Nnamdi Okonkwo, indicated that the banks were expecting N740 billion from the CRR refunds.
Meanwhile, Debt Management Office, DMO, has plans to issue N80 billion worth of local currency denominated bonds with maturities of between five and 10 years on October 14, according to a release, yesterday.